With the second Obamacare enrollment period in the books, congressional Democrats are already calling on the administration to give those who missed Sunday’s deadline more time. They say it’s unfair to expect health care consumers to have followed the law’s coverage mandate because their first round of Obamacare taxes aren’t due until April.
Democrats said Americans filling out their taxes will get their first big reminder about needing health care coverage if they have to pay a penalty for last year, which could goose them into signing up for this year — except the deadline for penalty-free enrollment in the federal exchange for 2015 expired Sunday. Those who aren’t covered this year will face an even bigger tax wallop next year.
“Without a special enrollment period, many people making a shared responsibility payment won’t have another opportunity to get health coverage this year,” Reps. Sander M. Levin of Michigan and Jim McDermott of Washington, the top Democrats on the House Ways and Means Committee, said in a statement.
The tax penalty is the big stick behind Obamacare, pushing folks to abide by the law’s “individual mandate” that all Americans either have insurance, qualify for an exemption or pay the tax.
The penalty for lacking insurance last year is the greater of $95 or 1 percent of household income above the filing threshold, to be paid as part of 2014 income taxes, which must be filed by April 15.
The administration predicted this year that as many as 6 million Americans will pay a penalty on their 2014 taxes.
The tax penalty is slated to leap this year to $325, or 2 percent of income.
The Health and Human Services Department estimated that 10 million new and returning customers had signed up on the exchanges through Feb. 11. While it is unclear how many more entered during the deadline rush, or how many will effectuate coverage by paying their premiums, the agency is poised to surpass its modest goal of 9.1 million enrollees for 2015 — a target below congressional budget estimates of 12 million.
Washington state officials Monday announced their own deadline extension, giving residents until April 17 to sign up on their state exchanges. That puts pressure on the Obama administration to offer a similar grace period to customers in the 37 states that rely on the federal HealthCare.gov exchange.
The administration has given a little ground by allowing those who experienced last-minute glitches in signing up until Feb. 22 to finish their applications. They can still be covered as of March 1.
But officials have hinted for weeks that they could do more. On Friday, Health and Human Services Secretary Sylvia Mathews Burwell told Politico that the department will make a final decision within two weeks.
The administration offered similar relief to customers who were “in line” when last year’s deadlines hit, though Republicans said Mr. Obama was overstepping the bounds of his authority in unilaterally moving deadlines.
Administration officials at the time defended the move as a type of prosecutorial discretion, similar to Mr. Obama’s immigration actions.
Timothy Jost, a law professor at Washington and Lee University who closely tracks the 2010 Affordable Care Act, said Obamacare allows the administration to offer special enrollment periods akin to those under the Medicare prescription drug benefit law, which provided for “exceptional circumstances.”
“I think that this would just be another example of that,” he said of the proposed fix for penalty payers. “I think the discretion is pretty wide open to do that.”
He said those who face the individual mandate penalty are likely to be healthier than most others — they’ve shirked coverage so far — so their late entry would not skew insurance rates.
“I think, if anything, it would improve the market,” he said.
HealthPocket, a Web company that lets customers compare insurance plans, said interest in open enrollment tends to be front-loaded and then wane significantly in the second half. Going forward, it said, the government should offer a shorter enrollment period that coincides with tax season.
“These changes would not only benefit consumers but also reduce advertising expenditures by exchanges and insurance companies alike,” HealthPocket Inc. CEO Bruce Telkamp said.
